Exhibit A

Selected Interstate Telemarketing Cases as Reported in theNAAG Telemarketing Fraud Bulletin from 1997-2005

Declaration of Anna Tooman, Indiana Attorney General's Office

I declare that every case listed below is a verbatim excerpt from the National AssociationofAttorneys General Telemarketing Fraud Bulletin. By consulting with each relevant state, Iwas able to confirm that the enforcement actions listed in Part I involved at least one interstatetelemarketing call. The remaining actions in Part I were easily confirmed by the recitation offacts in the excerpt. The enforcement actions listed in Part II are those that appear from the factsto have involved interstate telemarketing calls, but I was unable to confirm with the individualstates.

Anna Tooman

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I. Cases that Clearly Involve Interstate Telephone Calls or Have Been Confirmed bythe States

December 1997:

Illinois Indicts Toronto-Based Telemarketer

Illinois Attorney General Jim Ryan has indicted Toronto-based telemarketer ReedNichols on four counts of theft by deception arising out ofNichols' cross-border lottery scam.Nichols, who claimed to have been an agent of Windfall International, is alleged to havedefrauded an 84 year-old Northbrook, Illinois woman out of $980,000 by telling her that she hadwon $13 million in a Canadian lottery but would have to pay close to $1 million to cover taxesand fees on her winnings. Canadian authorities have also charged Nichols with one count oftheft arising out of the same transaction. Canadian officials have arrested Nichols and he hasbeen released pending trial. Illinois officials have issued a warrant for Nichols' arrest.

February 1998:

Washington Cracks Down on Badge Fraud

Washington Attorney General Christine O. Gregoire has reached a $55,000 settlementwith a New Jersey-based telephone fundraiser. According to the complaint, telemarketers forCivic Development Group, LLC, which raises funds for the Washington State Patrol Ti-oopersAssociation and the Washington Lodge ofthe Fraternal Order ofPolice, falsely claimed that theywere police officers. The te1emarketers also falsely claimed that 45 to 100 percent of the moniesdonated would go directly to law enforcement. Official 1996 Reports show this fundraiser gaveless than 25 percent to its charity clients. In addition to the $55,000 payment, the settlementforbids Civic Development Group, LLC from claiming to be police officers and making othermisrepresentations.

April 1998:

Wisconsin Settles with Ohio Fundraiser

Wisconsin Attorney General James Doyle has reached an agreement with CJW, Inc., ofPort Clinton, Ohio, a professional fundraiser that solicited donations for the Oshkosh PoliceBenevolent Association. General Doyle had alleged that CJW's telemarketers falsely claimed tobe law enforcement officers when soliciting for the Association. Further, CJW telemarketersmisled consumers and businesses to believe that all or most of their donations would be used tofund the "Shop with a Cop" program, which takes disadvantaged children Christmas shopping.Ofthe $49,000 raised by CJW telemarketers, only $9,400 went to disadvantaged children. Thesettlement requires CJW to comply with Wisconsin's charitable solicitations law, ensure that allCJW's subcontractors and independent contractors are properly registered with the WisconsinDepartment ofRegulation and Licensing, and provide each contributor, within five days after thesolicitation but before accepting a contribution, a written confirmation that clearly lists the name

. and address of the charitable organization on whose behalf they are soliciting.

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June 1998:

Wisconsin Files Suit Against Magazine Seller

Wisconsin Attorney General Jim Doyle has filed a lawsuit against Publishers Services, aWashington-based magazine subscription seller, and its owner, Daniel William Base. In the suit,General Doyle alleges that in an attempt to induce consumers to buy magazine subscriptions,Publishers Services' telemarketers falsely told consumers that magazine prices would soonincrease. Publishers Services telemarketers also told consumers that they would receive theirmagazines within six to twelve weeks after subscribing when, in fact, consumers did not receivetheir magazines until much later, if at all. The lawsuit seeks refunds for Wisconsin consumersand civil forfeiture.

August 1998:

Massachusetts Obtains Judgments AgainstFrandulent Texas Telefunders

Stating that his "office will continue to crack down on telemarketers who take advantageof the public and tarnish the hard work and reputations oflegitimate charitable organizations,"Attorney General Scott Harshbarger announced the entry of an order enjoining the AmericanVeteran's Relief Fund [AVRF], from soliciting Massachusetts residents until it pays $48,000 tofour Massachusetts VA medical centers. If AVRF fails to pay the full amount of restitution, withaccrued interest, by December 15, 1999, it will be permanently barred from soliciting inMassachusetts. Likewise, Attorney General Harshbarger obtained an order enjoining the HelpHospitalized Children Fund, Inc. [HHCF] from soliciting Massachusetts residents until it pays$30,000 to Children's Hospital in Boston. As with the order against AVRF, ifHHCF fiils tomake timely payments, the ban on its solicitation in Massachusetts will become permanent.Fundraisers hired by both defendants led Commonwealth residents and businesses to believethey were being solicited by volunteers or employees of the charities instead ofby paidfundraisers and that the funds raised would benefit hospitalized veterans and children. Thefundraisers repeatedly contacted the same pool of donors, falsely telling them they had madeprior contributions. In addition, the defendants' brochures indicated that contributions would beused to purchase wheelchairs, crutches, and therapeutic equipment for patients when, in fuct, thecharities provided only boxes ofpopcorn and toys.

Ohio Seeks to Put Phony Telemarketers Behind Bars

Ohio Attorney General Betty Montgomery and an Ohio county prosecutor indicted DavidBeasley, Thomas Cummings, and Ricardo Bendinelli on two felony counts each for operatingillegal telemarketing scams. The defendants operated two separate telemarketing scams andcould face up to a year in jail and a fine ofup to $2,500 for each count. Beasley, operating out ofAtlanta, Georgia, told consumers he was a Federal Express driver trying to deliver a sweepstakesprize, but could not deliver it unless the consumer wired $2,900 to an IRS agent to cover theprize taxes. The "IRS agent" was an associate of Mr. Beasley who received the "taxes."

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Cummings and Bendinelli ran a sirnilar scam out of Georgia. Bendinelli told consumers that, inorder to receive a cash prize, they had to send $2,300 to Cununings to cover "legal andadministrative costs." In at least one instance, the defendants claimed they never received themoney, and asked the consumer to send an additional $4,700. The defendants are charged withtheft over $500, failure to register with the Attorney General's office as telemarketers, andfailure to subrnit information to the Attorney General's Office regarding gifts, awards, or prizes.All three men are currently serving jail sentences in Georgia for operating telemarketing scamsas a result of a separate action.

October 1998:

Ohio Indicts Operator of Alleged Sweepstakes Scam

Ohio Attorney General Betty Montgomery, with the Hardin County Prosecutor, indictedan Atlanta-area man, Darious Davis Sr., on two felony counts and one misdemeanor count inconnection with his attempt to cheat a Hardin County senior. Davis allegedly used a phonyname while calling the victim to inform him he won a $2.5 million sweepstakes, and told theman he had to send $2,950 to Western Union in Atlanta in order to receive the prize. Davis toldthe man that a truck would deliver the prize money to his house once the he made the initialpayment. The consumer, suspecting a scam, contacted his local sheriffs office. Davis ischarged with attempted theft, failure to register with the Attorney General's Office as atelephone solicitor, and misrepresenting material restrictions, limitations, or conditions topurchase, receive, or use goods or services that are the subject of a telephone solicitation. Hefaces up to 180 days in jail and a fine of up to $1,000 for the theft charge, and six to 12 monthsinjail and a fine up to $2,500 for the felony counts.

Arizona Cracks Down On Work-at-Home Program

Arizona Attorney General Grant Woods entered into a consent judgment with HomeNetworking Association, Inc. d/b/a Innovative Services Group, a California-based company, andits owner, Jessica Brock. The company placed ads for work-at-home programs for bookkeepersand accountants. Ads instructed consumers to call a toll-free number which connected them withInnovative Services. Innovative Services then sold consumers software that it was not licensedto sell and an employer directory for $129 to $139. The company was not authorized to use thenames of the businesses in the directory and misrepresented that the businesses listed inthedirectory required that the home-based employee use the software. In addition, the businesseslisted in the directory were not hiring home-based employees. Innovative Services alsomisrepresented earnings potentials to consumers. The consent judgment requires InnovativeServices to return approximately $1,100 to consumers and pay a $10,000 civil penalty.

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December 1998:

16 Attorneys General Obtain Agreement From Travel Promoter

Attorneys General from 16 states\ led by New York Attorney General Dennis Vacco,have obtained an Assurance of Voluntary Compliance from Travel Opportunities Inc., a Florida­based travel business that allegedly marketed and sold vacation packages in a deceptive manner.According to the complaints, Travel Opportunities mailed "certificates of entitlement" toconsumers and asked them to call an 800 number to claim their prizes, and also set up contestbooths at trade shows and fairs to entice consumers to enter a contest for a vacation. Onceconsumers called, or were called by, Travel Opportunities, they were subjected to a high­pressure sales pitch to purchase a vacation costing over $400 that they had allegedly "won." Inaddition, Travel Opportunities failed to tell consumers that if they purchased the vacationpackage, they would be required to listen to a time share sales presentation. Under the terms ofthe AVC, Travel Opportunities is required to pay $600,000 in restitution, plus $400,000 inpenalties and costs, to participating states. The company must also disclose all costs and feesbefore a consumer purchases a vacation, and that consumers may be required to attend a salespresentation prior to purchasing vacations.

February 1999:

Wisconsin Obtains Judgments Against Three Magazine Telemarketers

Wisconsin Attorney General Jim Doyle obtained judgments against three out-of-statemagazine telemarketers: Publishers Services, and its owner, Daniel Base; Direct SalesInternational d/b/a Magazine Sweepstakes, Ltd.; and Direct Sales, Inc. Attorney General Doylealleged that Publishers Services failed to deliver magazines ordered by consumers, failed torefund money to those consumers, misrepresented that the company was affiliated with magazinepublishers, and misrepresented that it offered subscriptions at a reduced price which would soonincrease. The judgment requires the Publishers Services defendants to pay $165,429.85 inrestitution, forfeitures, penalties, and costs. Attorney General Doyle alleged that Direct SalesInternational and Direct Sales, Inc. telemarketers made misrepresentations regarding the pricesof subscriptions to consumers. Under the judgment, these companies are required to cancel allmagazine subscription contracts of Wisconsin consumers who file complaints with the AttorneyGeneral's office, and also must refund any money obtained from consumers after they attemptedto cancel their subscriptions; In addition, the companies are required to disclose, duringtelemarketing solicitations and in writing, the total number ofpayments, the amount of eachindividual payment, the aggregate amount to be paid for each subscription, and notice of theconsumer's three-day right to cancel an order. The companies have paid $12,500 in total forinvestigatory costs and attorneys' fees.

1Arkansas, Arizona, Connecticut, Illinois, Massachusetts, Michigan, Minnesota,Missouri, New Jersey, New Mexico, New York, North Carolina, Texas, Washington, Wisconsin,and West Virginia.

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Oklahoma Seeks to Stop Florida Company from Soliciting Donations

Oklahoma Attorney General Drew Edmondson filed a petition seeking a temporaryinjunction against the American Association of State Troopers [AAST] of Tallahassee, Florida,and its professionalfundraiser, Public Appeal of Southlake, Texas. In the petition, AttorneyGeneral Edmondson alleges that AAST and Public Appeal called unsuspecting donors and toldthem that their donations would be used to fund scholarships, legal aid, life insurance retirementbenefits, and death benefits for Oklahoma troopers. According to Attorney General Edmondson,"AAST misleads donors into thinking that donated money stays in the state and that donatedfunds go to state troopers. The fact is, AAST is in no way affiliated with the State ofOklahoma." Last year, AAST received about $7.37 million in donations from across the nation.Ofthat, about $5.87 million went to Public Appeal.

North Carolina Sues Two Arizona-based Telemarketing Operations

North Carolina Attorney General Mike Easley obtained temporary restraining ordersagainst Bank Card Recovery Service and Liberty Direct, two Arizona-based telemarketingoperations that called North Carolina residents and marketed credit card protection plans thatcost $199 to $289. In his suit against Bank Card Recovery Service, Attorney General Easleyalleges that the company misrepresented to consumers their liability for charges to lost or stolencredit cards. The second firm, Liberty Direct, is accused of falsely telling consumers that theywould be liable for credit card charges placed by thieves ifthey did not subscribe to their creditcard protection plan. Both telemarketing operations are also charged with failing to register withthe North Carolina Secretary of State. Both lawsuits seek permanent injunctive relief, restitution,and civil penalties.

June 1999:

Kentucky Indicts Nevada Telemarketer

Kentucky Attorney General Ben Chandler announced that David Lee Hall of Las Vegas,Nevada, has been indicted for theft by deception relating to telemarketing calls he made to anelderly Lexington, Kentucky, man. According to Attorney General Chandler, Hall contacted thevictim and falsely told him that the victim had won thousands of dollars and was required to sendmoney to cover administrative fees. "Thieves who use the telephone as a weapon to steal willno longer be able to escape by simply hanging up the phone. We will find them and bring themto Kentucky to face a Kentucky jury and if convicted, they will go to jail in Kentucky," saidAttorney General Chandler. Iffound guilty, Hall faces up to 5 years imprisomnent and/or a$10,000 fine.

Six States Reach Settlement With California Company

California Attorney General Bill Lockyer, Illinois Attorney General Jim Ryan, MinnesotaAttorney General Mike Hatch, Texas Attorney General Jim Cornyn, Vermont Attorney GeneralBill Sorrell, and Wisconsin Attorney General Jim Doyle reached a settlement with California­based Action Direct Marketing and its president Robert D. Hodges, resolving allegations that the

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company conducted deceptive telephone consumer health surveys. According to the AttorneysGeneral, Action Direct Marketing, under the fictitious entity "National Health Surveys,"misrepresented to consumers that it was conducting a national health survey to improve healthcare for the public. However, the company was actually compiling a marketing list of consumerswho indicated that they had hearing and other health problems. Action Direct Marketing soldthese lists, along with private health information it gathered, to its professional clients, includingdoctors, audiologists and chiropractors. These clients then used the names and information tosolicit consumers to purchase their professional services. Under the terms of the settlement,Action Direct Marketing is prohibited from misrepresenting the purpose of its consumer healthsurveys. The company is also required to affirmatively disclose all potential uses of consumerhealth information gathered in a health survey and, specifically, to disclose that such informationmay be shared with health care providers or services for marketing purposes.

August 1999:

Wisconsin Obtains Judgment Against Arizona Telemarketing Firm

Wisconsin Attorney General Jim Doyle obtained a judgment against Wesley JayGumeringer and Steven Robert Steveson, and their company, Furtherance International, Inc.d/b/a Premier Card Services, a telemarketing firm that marketed a credit card protection plan toWisconsin consumers. According to the lawsuit, Premier Card Services made severalmisrepresentations including: that they were VISA or Mastercard representatives when, in fact,they were not; that they were instructed by the Federal Trade Commission to call consumers andobtain their credit card numbers and expiration dates; and that consumers were required to havecredit card protection plans. In addition, the defendants had deducted $289 to $329 fromconsumers' credit cards without theirauthorization. The judgment prohibits the defendants from

. representing that:The caller is a representative of VISA, Mastercard, or the consumer's credit cardcompany;The caller needs to verify the consumer's credit card information;The caller has been instructed by the Federal Trade Commission to call credit cardholders to obtain their credit card numbers and expiration dates;The caller is checking the security of the consumers's credit card number for possiblefraud;The consumer is required to buy credit card fraud protection;The credit card protection service will cost the consumer a certain dollar amount, unlesssuch representation is true and there are concurrent disclosures of the application timeperiod and other terms ofthe service; orThe consumer may cancel the service without obligation within a certain period of time,unless that is true and the consumer is provided the specific method for exercising thosecancellation rights.The judgment also prohibits the company from debiting a consumer's credit card without

express authorization. In addition, the defendants must pay $12, 282 in investigatory costs andcivil penalties and reimburse consumers who purchased credit card protection plans.

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August 2000:

Ohio Settles With Telemarketing Company

Ohio Attorney General Betty Montgomery has reached a settlement with Bank CardSecurity Center, resolving allegations that the Florida-based credit card protection seller usedillegal tactics to frighten consumers into spending hundreds of dollars on unnecessary services.Attorney General Montgomery alleged that Bank Card: I) failed to register with the AttorneyGeneral as a telephone solicitor and the Secretary of State as a foreign corporation; 2)misrepresented its registration status with the Attorney General; 3) misrepresented materialaspects of its credit card protection service; 4) made false or misleading statements; 5) failed todeliver services paid by consumers; and 5) made unauthorized charges on consumers' credit

.cards. Under the terms of the settlement, Bank Card is prohibited from soliciting consumers inOhio and must pay $500,000 in civil penalties, of which $450,000 will be suspended pendingcompliance. Additionally, Bank Card has one year to provide full refunds to consumers. BankCard has already provided the State with a $50,000 deposit for restitution.

December 2000:

Iowa Announces Conviction of Georgia Telemarketer

Iowa Attorney General Tom Miller has announced the conviction of Robert Holland offelony theft by deception and conspiracy to commit theft by deception. Holland was also foundto be a habitual offender. Attorney General Miller alleged that Holland made numerousmisrepresentations while selling investments iIi foreign currency options. Holland falsely toldpotential investors that an $80,000 investment would yield a rate of return of $500,000 in amatter ofweeks. Holland faces up to 15 years imprisonment and fines up to $10,000.

Oregon Settles With Datatech

Oregon Attorney General Hardy Myers has reached an agreement with DatatechCommunications, resolving claims that the New Yark-based telemarketer sold advertisements inthe National Business Directory without being registered in the State. Under the terms ofthesettlement, Datatech is enjoined from telemarketing until it registers with the Oregon Departmentof Justice. Additionally, Datatech must pay $2,000 to the Oregon Consumer Protection andEducation Fund.

June 2001:

Oregon Settles With National Magazine Exchange

Oregon Attorney General Hardy Myers reached a settlement with Special DataProcessing Corporation d/b/a National Magazine Exchange, resolving claims that the Florida­based company failed to provide adequate information to consumers regarding the goods andservices it marketed. Attorney General Myers further alleged that the company failed to registeras an Oregon telemarketer. The settlement requires the defendant to register prior to

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telemarketing in the state and provide certain information to consumers when conductingtelephone solicitations. Lastly, the settlement requires the defendant to pay $25,000 to theOregon Department of Justice Consumer Protection and Education Fund.

December 2001:

North Carolina Obtains Judgment in Sweepstakes Case

North Carolina Attorney General Roy Cooper obtained a summary judgment againstTechnology Communications Management, L.L.C. d/b/a Global Network Enterprises, andprincipals Cecilia Margarita Castillo and Ian Anthony Suite.

Attorney General Cooper alleged that the defendants falsely told elderly consumers thatthey had won a California sweepstakes and must provide their bank account numbers to ensurepayment of California taxes. Attorney General Cooper further alleged that the defendantscharged victims' accounts immediately, but never delivered a prize. The court entered ajudgment for $200,000 in civil penalties, $30,179 in victim restitution, and $6,000 in attorneys'fees against all the defendants:. In addition, the COBRA Telemarketing Fraud Task Force inOrange County, California filed criminal actions against the defendants in federal court in June2000. Defendants Castillo and Suite were charged with money laundering and wire fraud andthose cases are ongoing.

April 2002:

Ohio Announces Indictments in Sweepstakes Scam

Ohio Attorney General Betty Montgomery armounced the indictment of FloridiansBrandy Merrill and Henry Lee Elam, Jr., on charges of operating a fake sweepstakes promotion.Attorney General Montgomery alleges that the defendants operated a business named "RobinLeach's National Clearinghouse," without evidence that TV personality Robin Leach wasinvolved. Attorney General Montgomery also alleges the defendants told consumers they won asecond prize in a sweepstakes, and would have to send money to cover the "taxes" on theirwinnings. Brandy Merrill was indicted on 38 counts, including engaging in a pattern of corruptactivity, various Telephone Solicitation Sales Act violations, and receiving stolen property.Henry Lee Elam, Jr. was indicted on seven counts ofreceiving stolen property.

June 2002:

North Caro1iua Obtains Million Dollar Settlement

North Carolina Attorney General Roy Cooper obtained a consent judgment againstBuyers Source, of Chesapeake, Virginia, owners, Thomas Brewer and Frederick Blake, andagent, Lannie Campbell, resolving claims the defendants deceptively marketed residentialbuilding lots. Attorney General Cooper alleged that Buyers Source called North Carolinaresidents and offered to purchase timeshares, campground memberships, and vacation clubmemberships for $10,000. Attorney General Cooper alleged that consumers interested in selling

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their timeshares or memberships were invited to meet with Buyers Source agents at a nearbyhotel. Only after arriving at the meeting did consumers discover they had to first purchase lots atSavannah Lake before Buyers Source would purchase their timeshares or memberships.According to Attorney General Cooper, 38 North Carolinians purchased lots and paidapproximately $30,000 for each lot that Buyers Source had bO)lght for $2,000. Under theconsent judgment, Buyers Source must provide consumers with $1,026,000 in cash andmortgage relief. The judgment will relieve consumers of mortgage debts worth $27,000 per lot.In addition, consumers will retain approximately $6,000 from the sale of each oftheir timesharesor memberships.

Oregon Settles With Dimensional Express Services

Oregon Attorney General Hardy Myers entered an Assurance of Voluntary Compliancewith San Antonio-based Dimensional Express Services, Inc. d/b/a vacationcollect.com, resolvingallegations it made collect calls to consumers to "pitch" vacation packages. According toAttorney General Myers, consumers were charged $8 to $9 per minute for the collect calls.Attorney General Myers further alleged the defendants failed to register as telemarketers with theOregon Department of Justice.

The AVC requires the defendants to provide full refunds to complainants, including thecost of collect calls and vacation packages. The AVC also requires the defendants to pay $3,000to the Consumer Protection and Education Fund. Lastly, the defendants are prohibited fromengaging in telemarketing activities for the next 18 months, and thereafter, can telemarket only ifregistered with the Oregon Department of Justice. '

August 2002:

Michigan Files Notice oflntended Action Against Paragon Laboratories

Michigan Attorney General Jennifer Granholm filed a Notice of Intended Action againsta Florida corporation, Paragon Laboratories, Inc. d/b/a Suncoast Chemical Company and SantaFe Chemical, alleging it violated the Michigan Consumer Protection Act and the TelemarketingSales Rule by misrepresenting or failing to disclose information regarding the cost of its cleaningproducts, restrictions and conditions on purchases, and cancellation policy details. According toAttorney General Granholm, Paragon billed Michigan schools and hospitals for cleaning suppliesthey did not order. Paragon filed collection suits in Florida against three Michigan schoolsthat refused to pay for products. According to Attorney General Granhohn, Paragon filed similarsuits against hospitals and schools in Illinois, Iowa, Kentucky, Louisiana, Mississippi, Ohio,South Carolina, Texas, Tennessee, and West Virginia.

Oregon Settles With Fundraisers

Oregon Attorney General Hardy Myers reached a settlement with Fundraisers, Inc., aFlorida-based telemarketer, and its president, Steven Chanzes, resolving allegations they failed toregister to solicit contributions in Oregon and misrepresented that contributions would supportthe Marion County Sheriffs office.

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The settlement prohibits Fundraisers from soliciting in Oregon for five years and requiresit to pay $5,000 to the Marion County Sheriffs Office. In addition, the defendant must pay$5,000 in civil penalties to the Department of Justice and $5,000 in investigatory costs andattorneys' fees.

October 2002:

Michigan and Rhode Island Sue MedPlan

Michigan Attorney General Jennifer Granholm and Rhode Island Attorney GeneralSheldon Whitehouse filed suits against MedPlan, Inc., of Toronto, Canada, alleging MedPlantelemarketers called consumers, often seniors, and falsely told them they would send materialsabout the "MedPlan plan" - a membership club providing discounts on chiropractic, vision, anddental services, prescriptions, and other health-related services and products· for $349.According to Attorneys General Granhohn and Whitehouse, MedPlan telemarketers requestedconsumers' bank account numbers for "verification purposes" and failed to clearly disclose thatthe information would be used to withdraw the membership fees from consumers' accounts.Lastly, when consumers cancelled the plan, MedPlan failed to provide timely refunds toconsumers. The suits seek penalties and restitution.

North Carolina Files Suit Against GoInternet.net

North Carolina Attorney General Roy Cooper filed suit against Neal D. Saferstein, ownerand president of Philadelphia-based GoInternet.net d/b/a Mercury, Mercury Internet Services,MIS, Mercury Marketing, Mercury Long Distance, Mercury Wireless Services, and Venus VoiceMail.

Attorney General Cooper alleges the defendants charged consumers $29.95 for Internetservices, even though consumers declined the offer or agreed only to receive additionalinformation. GoInternet submitted charges to a "billing aggregator" that imposed charges onconsumers' telephone bills. In some cases, GoInternet telemarketers spoke with a child or anemployee who was not authorized to order service, but the company enrolled the household orbusiness anyway. The suit seeks refunds for consumers and civil penalties of $5,000 for eachinstance ofunfait and deceptive trade practices.

North Carolina Takes Action Against Credit Offerors

North Carolina Attorney General Roy Cooper obtained preliminary injunctions againstFirst National Credit and principals Steven Golgolab and Malnnoud Karkenhabadi, and BayArea Business Council and principal agent Peter Porcelli, following allegations they deceptivelymarketed credit cards to consumers. .According to Attorney General Cooper, First NationalCredit offered consumers a "gold" credit card with a credit line of $15,000 and debited"membership" fees from consumers' accounts. Attorney General Cooper alleged that severalconsumers received no credit card, while others received a catalog of merchandise and a "gold"card, good only for catalog purchases. Consumers who ordered from the catalog had to make a

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cash payment of up to 45% of the purchase price and an 18% fee for shipping, handling, and"insurance."

Attorney General Cooper alleged that Bay Area Business Council falsely told consumersthey would receive a MasterCard with a credit limit of $2,000 and an initial interest rate of 0%.Many consumers authorized the company to debit fees, ranging from $184 to $209 from theirbank accounts. Other consumers had their accounts debited without their approval. Instead ofcredit cards, consumers received a package of travel opportunities, photo processing offers, andapplications for prepaid debit cards. (See June 2002 Telemarketing Bulletin).

In separate actions, Attorney General Cooper issued five Cease and Desist Notices totelemarketers soliciting credit-related services and advance fee loans. Namedin the notices are:J.T. Card Services, ofNorth Miami Beach, Florida; Zybertour, Inc., ofOrlando, Florida;Archon Enterprises, of Toronto, Canada; Central Benefits, of Kirkland, Canada; and AmericanGold Card, ofMontreal, Canada.

Oklahoma Files Suit Against Telephone Protection Agency

Oklahoma Attorney General Drew Edmondson filed suit against Telephone ProtectionAgency, Inc., of Hickory, North Carolina, alleging the defendant used Oklahoma's "no-call"

.program as bait for its telephone solicitations. . Attorney General Edmondson alleges thedefendant illegally transferred $99 from consumers' bank accounts and falsely implied that itwas associated with the Attorney General's Office. Attorney General Edmondson further allegesthe defendant falsely told consumers it knew they had signed up for Oklahoma's "Don't Call"Program and, for an additional fee, its service could eliminate all telemarketing calls. Oneconsumer declined the offer, but discovered that the company had debited $99 from her account.The suit seeks a permanent injunction, consumer restitution, civil penalties, attorneys' fees, andinvestigatory costs,

February 2003:

Texas Sues Asset Recovery Group

Texas Attorney General Greg Abbott filed suit against California-based Asset RecoveryGroup, Inc., and owners Robert Barrere and Debra Millward, alleging they violated theDeceptive Trade Practices Act when they deceived consumers about their services. AttorneyGeneral Abbott alleged the defendants made late-night automated phone calls to consumers. Thedefendants informed consumers they had reserved unclaimed assets, valued at $500 or more, onconsumers' behalf and instructed consumers to send $25 to receive an application for recovery ofthe assets, or to call a 900 number for information. The defendants' continued practice violated aprevious permanent injunction. The defendants still owe the state about $20,000 in attorneys'fees and investigative costs.

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April 2003:

North Carolina Halts "Credit Card" Offerors

North Carolina Attorney General Roy Cooper obtained a temporary restraining orderagainst Florida-based National Association of Credit Services and owners Steven Raykher andTeresa Rich. Attorney General Cooper alleges the defendants falsely told consumers they wereapproved for a credit card. Consumers who paid a $200 processing fee received nothing or a cardthat could be used only to purchase items from a catalog. In addition, the defendants failed toprovide refunds or falsely told consumers they risked damage to their credit report, if they didnot pay the required cancellation fee. Attorney General Cooper seeks to permanently enjoin thedefendants from conducting business in North Carolina, as well as the payment of refunds andfines.

Oklahoma Enjoins Telemarketing Law Violations

Oklahoma Attorney General Drew Edmondson announced orders prohibiting twoArizona-based companies, National Telegard Systems and Senior Benefit Association, fromsoliciting Oklahoma consumers until they registered with his office. According to AttorneyGeneral Edmondson, both companies deceptively marketed identity theft protection services to aconsumer, implying that they contacted her because she signed up for Oklahoma's Don't-Calllist and to protect her from the telemarketing calls she would receive when the Attorney Generalsold her personal information. A court ordered Senior Benefit Association to pay $7,500 inattorneys' fees and investigative costs. National Telegard Systems must pay a civil penalty of$5,000.

Wisconsin Obtains Judgment Against MagaZhle Sales Company

Wisconsin Attorney General Peg Lautenschlager obtained a judgment against Minnesota­based Midwest Readers Service, Inc. Attorney General Lautenschlager alleged the defendantfailed to disclose its name, the purpose of its calls, and the total cost to purchase magazines. Thedefendant also failed to notify consumers of their three-day right to cancel. The judgmentprohibits Midwest Readers from its deceptive acts and practices and requires it to providerefunds to consumers and pay $12,500 in investigatory costs.

June 2003:

North Carolina Sues Telecommunication Companies

North Carolina Attorney General Roy Cooper filed suit against Miami-based LibertyOnline, National Online, Ameripages, and B2B Advantage, alleging they placed unauthorizedcharges on consumers' telephone bills. According to Attorney General Cooper, the defendants'telemarketers mislead consumers about the costs of their Internet and telecommunicationsservices or signed them up without their approval. In some cases, the defendants falsely claimedthey were conducting a surveyor confirming information about a customer's account. The suitseeks refunds and civil penalties.

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August 2003:

North Carl/Dna Ibllts lJllclaimcd Property Scbcme

North CarolinaA1torney GeneralJl.ay Coop.,;-oi>tainedatemp(lI1uYres1l:a~order agai.n$t.Califomia"i>ased Unclaimed Property Center and directors Debra Millward anli.RobettBarr%prohibiting~ ftom telemarlreting unclaimed property ~lees. According to A\tofOey GeneralCooper, the defendantsused 4eceptivereeonledtelemarkctingmessages to misleadconsumers intobelieving they would receive unclaimed property if they paid a finder's fee. Unclaimed Propertyneverconducted researchon ailSets <)wned bycons1UlletS. Thesl]it seeks to pmnanentlyenjointhedefendants ftom s<)1iclling in the state, as well as the paymeirtofcivil penalties.

December 2003:

Iowa Sues Telefunder

IowaAttorneyGeneral Tom MillerfiledSuitagainstFlOrida-based Xentel,Inc.,whichsolicits.donations in the name ofthelowaPro:f'essionalfirllFigl:itersAssociation[IPFF]. Tbesultallegeslhl¢Xentel pays the IPFF $12,000 monthly, keeps all ~tions over that amount, and that Xentel'steI~etel's illlselyclaimtobe!irefighters andthatalldonatedfundswlIIgo to local fire departments..~$QltseeksapennanentinjunctiQ11,restitutiOll,andcivilpena1~incIMinganadditionalcivilpena1tyofupto $5,000 for each violation romntitted against older Iowans.

North Carollna Halls wan Offeror

NurtJt Carolil!llAttorneyGeneralRoy Cooper obtainedatempararyrestrainingorcl<lragainstAr!zona-basedC0llSU1tlerProtectionPublication, Inc. and principals WilliamR. QrosbyandGregorioGomez,prohlbitingthemfromtelemarketinginto thestate.According toAttomeyGeneraI Cooper,the

.detendanls targetedcollSUlllers withcreditproblemsandfulselypromisell them lower inrerestratesonthelreredilcatds andspecialcreditcard"protections."Consumerswhoagt'Cedto1hedefendants' offerhlK!~397 charged on1heircredi.tcards,butreceived nothingorsimplyalistofcreditcardcompanies andahow-toguidefororganizingandnumagingdoots. Thesuitseekstope!llllllllllll1yenjointhedefendantslfomtheir deceptive practices, as well as civil penalties and refunds.

Wisconsill Obtains JlIdgmeJlt Against Telecom Company

WfsconsinAJtorney GenermPegLautelf!u::hlagerobtainedajudg)1lelltagainstFlotidl\.bl\Sed.. TalkToo Me, enjoiningitfrombillingconsumersandbusinessesfurtelecomnwllicationservicestheydidnotaffirmativelyomer.Accordlng to AttomeyGeneraJLautenschlager, thedefilndantl:Ulnd1edthebillirtgfor AmericanDire<)toryIiCl"lliees(ADS), aftaudulClltandnow-defunctNew.Mexic9+~t~enliIrketertlilif¢illea~!lfSCQll¢etto sellIni:en1ctdir,:cloI)"services, ADSlelemarketersmisled COIlSUI'llers intobtilieying1heywerereceivingcel1ectcaUsfrom friendsorrelatives.WhenconsllIlliJI"s realized1hecallwasa sales pitch, theyhullg up. ADS processed the collect calls as "accepted" and Talk TQI> Me billedconsumers $29.44 for the caU.• The judgment requires Talk Too Me to provide consumer refunds.

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February 2004:

Oregon Settles With Gas Vouchers Offeror

Oregon Attorney General Hardy Myers reached a settlement with Nevada-basedContinuity Partners, Inc., resolving allegations its telemarketers falsely told consumers they wereselected to receive $200 in gasoline vouchers for the U.S. government to help pay for highgasoline prices. The telemarketers told consumers who accepted the offer that they would becharge $1.95 for shipping and handling. Consumer did not receive the gasoline vouchers, rather,they were signed up for a free trial of the U-Talk Unlimited phone card. If consumers did not optout ofthe phone plan, their credit cards were charged an enrollment fee. The settlement requiresthe defendant to provide refunds and pay $7,500 to the Consumer Protection and EducationFund.

April 2004:

North Carolina Sues Credit Counseling Companies

North Carolina Attorney General Roy Cooper and Wake County District Attorney ColonWilloughby filed suit against Massachusetts-based Cambridge Credit Counseling Corporationand Florida-based Debt Management Foundation Services, Inc., alleging they charged consumershigh fees for plans to get out of debt. According to Attorney General Cooper and DistrictAttorney Willoughby, the defendants' telemarketers falsely told consumers their companiesoffered non-profit credit counseling services. The defendants also failed to tell consumer thatsome payments would go directly to the defendants and not to creditors. The suit seeks to banthe defendants from advertising, soliciting, or engaging in debt adjusting services in the State.The suit also seeks cancellation of all contracts, as well as refunds and civil penalties.

North Dakota Settles With Travel Offerors

North Dakota Attorney General Wayne Stenehjem reached a settlement with Florida­based Cape Canaveral Tour & Travel d/b/a! E Tour & Travel, Inc. and telemarketer, FantasyVacations, Inc. resolving allegations they misrepresented that their travel packages wereapproved by the Attorney General. Attorney General Stenehjem also alleged the defendantsfalsely told consumers they were a "select" group, eligible to receive the offers. The settlementprohibits the defendants from their misrepresentations and requires the payment of$5,000 incivil penalties. The defendants also agreed to cancel contracts entered into in December 2003.

June 2004:

Iowa Bars Nevada Telemarketer

Iowa Attorney General Tom Miller announced an Assurance of Voluntary Compliancebarring Brian MacGregor, who did business as CPI, American Values, U-Talk Limited, Wellnet,Blitz Media, and Washball, from doing business in Iowa. The defendant and his companiescalled consumers and claimed they would provide them with $200 in gas coupons in exchange

16

for payment of $1.95 for shipping and handling. Callers required consumers to provide theirbank account numbers to facilitate the debiting of their accounts for the $1.95 charge. Callersalso encouraged consumers to try "free trial offers" and other goods or service, such as long­distance calling cards. Consumer who refused the additional offers discovered hundreds ofdollars of debits from their bank accounts. In addition to barring the defendant from doingbusiness in Iowa, the AVC requires MacGregor to provide a refund to every Iowan who requestsone.

Wisconsin Sues Newsletter Publisher

Wisconsin Attorney General Peg Lautenschlager frIed suit against Pennsylvania-basedProgressive Business Publications, Inc. alleging it telemarketed "free" trial newslettersubscriptions, but sent "invoices" that misled organizations into believing they had purchased asubscription to the newsletter. The suit seeks forfeitures and penalties, as well as an orderrequiring the defendant to halt is deceptive practices and refund unlawfully collected moneyfrom consumers.

August 2004:

North Dakota and Oregon Settle with Global Mindlink and Select International

North Dakota Attorney Gener~l Wayne Stenehjem reached a settlement with Florida­based Global Mindlink Foundation, Inc. and Select International Donors, Inc., and their principaloperator Denise Battista, resolving claims their telemarketers falsely claimed they were solicitingdonations on behalf of a non-profit organization assisting abused and neglected children. GlobalMindlink and Select International also misled consumers into believing they were eligible to winprizes, falsely claiming consumers had agreed previously to join Global Mindlink. Thesettlement requires the two companies to pay $12,000 in restitution and $10,000 to the AttorneyGeneral's office. The settlement also permanently enjoins the defendants from charitablesolicitations or sales in the state.

In a separate action, Oregon Attorney General Hardy Myers obtained an Assurance ofVoluntary Compliance with Global Mindlink Foundation and Select International Donors,resolving claims they sold "memberships" for $50 to $600 with false promises ofvaluablecoupons, free film, and sweepstakes entries while claiming the proceeds would help providecomputers for the disabled. The AVC requires the companies to provide restitution to victimsand prohibits them from soliciting in the state.

Washington Settles With DSI Financial

Washington Attorney General Christine Gregoire reached a settlement with Florida-basedDebt Solutions, Inc. alk/a DSI Financial Inc., resolving allegations it used high pressure salestactics and misleading telemarketing pitches to sell debt reduction services. According toAttorney General Gregoire, the defendant misrepresented the costs of its services and theguaranteed savings of its debt reduction plan. The defendant also falsely told consumer there

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was a no-cancellation policy when, in fact, consumers had a three-day right to cancel. Thesettlement requires the defendant to pay restitution, civil penalties, and attorneys' fees.

September 2004:

Iowa Files Suit Against Teledraft, Inc.

Iowa Attorney General Tom Miller filed suit against Teledraft, Inc., a Delawarecorporation with its principal place ofbusiness in Phoenix, AZ., alleging that the company"facilitated consumer fraud" by enabling deceptive te1emarketers to automatically withdrawmoney from people's bank accounts without their permission or approval. Also named in the suitare Al Slaten, president and an owner of Teledraft, and Dan Wolfe, an owner of Teledaft andArizona resident who owns a larger share than any other individual.

Maine Sues Telemarketer Over Illegal Solicitations

Maine Attorney General Steve Rowe filed suit against Florida-based International LawEnforcement Garnes, Inc., and its paid fundraiser All-Pro Telemarketing Associates Corp.Attorney General Rowe alleges the two entities violated the Maine Solicitation by LawEnforcement Officers Act by representing to prospective donors that donations would benefitlaw enforcement officers, agencies, or associations. The defendants also violated the UnfairTrade Practices Act by misrepresenting that their contributions would assist a "major children'swish fulfilhnent organization" that they failed to identify.

October 2004:

Texas Files Suit Against Companies Targeting Hispanic Consumers with Credit CardScam

Texas Attorney General Greg Abbott filed suit against Florida-based Julio CesarSandoval, Carlos Felipe Mendez, LatinCard Plus, L.L.C., ProLine Card L.L.C., Call CenterExpress Corp., and Tradex L.L.C., alleging they targeting Hispanics with false promises ofmajorcredit cards with high credit limits. In actuality, the companies required an up-front fee of up to$299 from consumers who responded to heavily marketed advertisements on Spanish-languagetelevision and radio stations. The "credit cards" they received were good only for purchases ofitems from the defendants' catalogs and websites. The suit seeks refunds and injunctive relief.

November 2004:

Iowa Obtains Judgment Against Xentel, Inc.

Iowa Attorney General Tom Miller obtained a consent judgment and order againstXentel, Inc., requiring the Ft. Lauderdale-based company to stop abusive and misleadingpractices in its professional fundraising calls and solicitations to Iowans. According to AttorneyGeneral Miller, Xentel made tens of thousands of telemarketing calls each year into Iowa onbehalfof the "Iowa Professional Fire Fighters Association." Xentel also implied their

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telemarketers were fire fighters or misrepresented that money would be used locally. Theconsent judgment ensures that local law enforcement or fire departments that experience citizencomplaints or other problems with Xentel's fundraising can ask the company to terminatefundraising in that community, and Xentel must honor the request.

Iowa Sues "American Deputy Sheriffs' Association"

Iowa Attorney General Tom Miller filed suit against ADSA, Inc. d/b/a the AmericanDeputy Sheriffs' Association, a not-for-profit corporation headquartered in Louisiana that asksfor donations purportedly to help Iowa law enforcement agencies with things like bullet-proofvests and benefits to families of officers killed in the line of duty. Other defendants named in thesuit are Michael Croft, past president of ADSA; Ashley Isaac, president ofADSA; ThomasBuchman, internal auditor ofADSA; EulaLee Warner, secretary-treasurer of ADSA; PublicAwareness, Inc., a professional fund-raiser business that contracts with ADSA and is based inEau Claire, Wisconsin; and Duane Kolve, president ofPublic Awareness, Inc. The suit seeksinjunctive relief, as well as a court order requiring the defendants to pay up to $40,000 for eachviolation of the Consumer Fraud Act.

Michigan Issues Notice of Intended Action Against Grant Offeror

Michigan Attorney General Mike Cox issued a notice of intended action against Florida­based Consumer Grants USA, which does business under different names, including UltimateFunding, Consumer US Grant Guide, Customer Care Plus, and Federal Grant InformationCenter. According to Attorney General Cox, Consumer Grants USA made misleadingtelemarketing calls that falsely promised government grants of $8,000 to $25,000 if consumerspaid a $239 "processing fee." Consumers were asked by telemarketers to give their personal bankaccount information, permitting payment to be withdrawn directly from their bank account. Afterpayment was withdrawn, consumers received an informational guidebook rather than thepromised grant.

December 2004:

Massachusetts Issues Restitution Checks

Massachusetts Attorney General Tom Reilly issued refund checks, ranging from $100 ­$500, to more than 1,400 Massachusetts consumers who paid up-front fees to a Florida-basedtelemarketer to enroll in credit counseling provided by a non·profit corporation. The checks,totaling close to $400,000, stem from a settlement Attorney General Reilly reached earlier thisyear with Integrated Credit Solutions (ICS), Inc., of Largo, Florida. The settlement resolvesallegations that ICS gave false and misleading information about benefits and savings to lureconsumers into purchasing credit counseling services.

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North Carolina Halts Phony Computer Scam

North Carolina Attorney General Roy Cooper obtained a preliminary injunction againstCalifornia-based Del Sol, alleging it told consumers they won a free laptop, but required them tomake a purchase in order to collect a prize. The defendant required consumers to purchase twowatches, 10 religious-based CDs, and 10 bottles of name-brand perfume. When the shipmentarrived, it included some CDs, perfume, and watches, but did not include a computer. The suitseeks restitution and civil penalties.

January 2005:

Ohio Sues Continuity Partners

Ohio Attorney General Jim Petro filed suit against [Nevada-based] Continuity PartnersInc. d/b/a Continuity Partners, UTALK, American Values, WELLNET, and Washballs, allegingit sold $200 worth of gasoline coupons for a one-time shipping and handling fee of$1.95, butfailed to provide the coupons. In addition, Continuity Partners obtained consumers' bank­account information to facilitate payment for the coupons. Consumers reported that ContinuityPartners debited additional, unauthorized charges from their accounts. These charges rangedbetween $19.95 and $597.30 for products and services consumers did not purchase, such as long­distance services, retail discounts, prescription drug discounts, and laundry cleaning products.

Ohio Announces Prison Term for Canadian Lottery Telemarketer

Ohio Attorney General Jim Petro announced the sentencing of Shawn Rawley to threeyears in prison for his role in a telemarketing scam operated from Montreal. The victim, anelderly Ohio resident, sent several packages of cash payments to addresses in Montreal,Vermont, and New York. In all, the woman sent more than $75,000. In August 2003, Rawleywas arrested in New York City while picking up a Federal Express package containing thevictim's final payment.

February 2005:

North Carolina Takes Action Against Telemarketers in Florida

Attorney General Cooper filed suit against Florida-based Phoenix Consumer Services,alleging it falsely told consumers that the company could improve their credit rating or sendthem apre-approved credit card for a $129.95 fee. Consumers who paid the fee received neithera credit card nor help with their credit. Phoenix also allegedly debited consumers' accountswithout their authorization.

Wisconsin Files Against Continuity Partners

Wisconsin Attorney General Peg Lautenschlager filed suit against Nevada-basedContinuity Partners, Inc., as well as president Brian K. MacGregor, alleging they promisedconsumers $200 worth of gasoline coupons or free telephone calling cards and asked them to

20

provide their bank account or credit card infonnation so that the company could obtain ashipping and handling charge of $1.95. Consumers never received the promised coupons orcalling cards, but discovered that large withdrawals had been taken from their accounts.

March 2005:

North Dakota Obtains Judgment in Government Grant Scam

North Dakota Attorney General Wayne Stenehjem obtained a judgment against Florida­based Consumer Grants USA, Inc., Ultimate Funding Plus, Inc., Ultimate Funding, Inc.,Customer Care Plus, Inc., and James T. Lovern for violations ofthe state no-call law, consumerfraud law, and a cease and desist order. According to Attorney General Stenehjem, thedefendants called consumers and falsely promised government grants if they paid a "processing

. fee" of$239. The judgment prohibits the defendants from doing business in North Dakota andrequires them to pay restitution.

April 2005:

North Carolina Blocks Telemarketer

North Carolina Attorney General Roy Cooper obtained a preliminary injunction againstFlorida-based Consumer Grants USA, Inc., president James T. Lovern, and vice president Leo J.Corrigan, enjoining them from making calls to or taking money from North Carolinians.According to Attorney General Cooper, the defendants falsely told consumers they werequalified for or were guaranteed to receive government grants in exchange for a fee. The suitseeks to pennanently bar the defendants from deceiving consumers, as well as refunds and civilpenalties.

North Dakota Issues Cease and Desist Orders Against Grant Companies

North Dakota Attorney General Wayne Stenehjem issued cease and desist orders againstNational Grant Assistance or National Grant Association, operated by Eliyya Shukeir ofMontreal, Quebec and with a post office box in Champlain, New York; Express Grant d/b/a GEInternational and American Grant Services, operated by Roger Samara of Montreal, Quebec andwith a mail drop in Champlain, New York; and grantforyou.com a/k/a Grant For You andpremierbusinessgroup.net, operated by Vincent Cataldi, in Delray Beach, Florida, with a mailingaddress in Phoenix, Arizona. The defendants falsely told consumers they were entitled to andguaranteed government grants in exchange for a $349 fee.

North Dakota Secures Refunds from Business Directory Company

North Dakota Attorney General Wayne Stenehjem obtained an Assurance of VoluntaryCompliance with World Wide Source, requiring it to cease selling directory listings and pay$3,380 in refunds and $2,500 in civil penalties. According to Attorney General Stenehjem,Montreal-company Word Wide Source, doing business out of Plattsburgh, New York, claimed to

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publish a business directory called "American Business Index," and demanded payment frombusinesses listed in the directory, even though they had not requested a listing.

May 2005:

Arkansas Sues Telemarketers Targeting Latino ResidentsArkansas Attorney General Mike Beebe filed suit against California-based Del Sol LLC

d/b/a Del Sol Educational Telephone, and owners Fernando T. Gonzalez and Ana MariaGonzalez, alleging they targeted Spanish-speaking consumers who had a limited understandingof English and offered a promotional prize package at a cost of about $230, which, whendelivered, did not contain the promised prizes. Attorney General Beebe is seeking restitution,civil penalties, and an injunction halting Del Sol's Arkansas operation until it stops its deceptivepractices and complies with state and federal "Do-Not-Call" laws.

Ohio Sues Credit Card Marketers

Ohio Attorney General Jim Petro filed suit against Oklahoma-based Credit Now, Inc.d/b/a Commercial Products and president Ed Harris, alleging the company telemarketedunsecured credit cards for fees ranging from $149 to $159, without registering in Ohio as atelephone solicitor. Consumers did not receive the promised cards; only a card application.

Oklahoma Settles with CBG

Oklahoma Attorney General Drew Edmondson has settled allegations against Arizona­based Consumer Benefits Group, Inc., resolving claims it deceptively telemarketed anti-identitytheft services, was not registered as a telemarketer in the state, and called consumers onOklahoma's Don't-Call list.

June 2005:

North Dakota Halts Dubious Charities

North Dakota Attorney General Wayne Stenehjem reached a settlement with Califomia- .based Association for Disabled Firefighters, Coalition of Police & Sheriffs, and AmericanVeterans ReliefFoundation and their professional fundraisers, Public Awareness and DuaneKolve, resolving allegations the defendants misled donors into believing they were localorganizations. The defendants also were not licensed in the State. The settlement prohibits thedefendants from conducting charitable solicitations in the State and requires them to pay$30,000.

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North Dakota Issues Cease and Desist Order Against Consumer Rewards Network

North Dakota Attorney General Wayne Stenehjem issued a Cease and Desist orderagainst California-based Consumer Rewards Network and affiliates Mega Movie Club, HealthNet, and Net Forever. Attorney General Stenehjem alleges Consumer Rewards Networkrepresentatives, falsely claiming to be from Wal-Mart, offered consumers vouchers for Wal-Martshopping sprees worth up to $500. In return, consumers agreed to pay nominal fees to be debitedfrom their accounts. Consumer Rewards used the account information to commit consumers toadditional and automatic charges.

Ohio Sues Warranty Company

Ohio Attorney General Jim Petro filed suit against Arizona-based Car Care Warranty,LLC d/b/a Vehicle Owner Warranty Notification Center, alleging it deceptively claimed anassociation with consumers' auto dealerships or the manufacturer of consumers' cars, and that ittelemarketed in Ohio without registering as a telephone solicitor.

II. Cases Involving Apparent Interstate Telemarketing Calls that Have Not BeeuConfirmed by the States

December 1997:

Pennsylvauia Sues Florida-Based Charityand North Caroliua-Based Telemarketer

Pennsylvania Attorney General Mike Fisher has filed a lawsuit against TelcomTelemarketing Services, Inc., ofNorth Carolina, and the Florida-based National VietnamVeterans Coalition Foundation, which hired Telcom to telemarket on its behalf. The suit allegesthat Telcom telemarketers misrepresented themselves as Vietnam veterans and falsely toldconsumers that their contributions would aid only Pennsylvania veterans. It also alleges that theFoundation failed to register as a charity with the State prior to soliciting contributions fromPennsylvania residents.

February 1998:

Pennsylvania Reaches Badge-Fraud Settlement with New Jersey Telemarketer

Pennsylvania Attorney General Mike Fisher has reached a settlement with ProfessionalAdvertising Directors, Co., Inc., ofFlanders, New Jersey, requiring the company to pay $15,000in restitution, civil penalties and costs for giving false and misleading information to consumerswhile fundraising for Le-Hampton Fraternal Order of Police Lodge #35 of Lehigh andNorthampton counties. Fisher alleged that Professional Advertising Directors telemarketersfalsely claimed to be police officers when soliciting contributions. The telemarketers also lied bystating that all contributions would be used for training seminars, a widows fund and to assistlocal police departments. Contributions actually supported the Fraternal Order of Police's legaland arbitration expenses and funded life insurance policies for its members.

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Pennsylvania Reaches Agreement withIllinois-Based Telemarketer

Pennsylvania Attorney General Mike Fisher has reached a settlement with TeleservicesInternational, Inc., a Chicago-based telemarketer. Teleservices failed to register pursuant toPennsylvania's Telemarketer Act and Consumer Protection Law -- a new law requiringtelemarketers doing business in Pennsylvania to register with the Attorney General and to postabond. The agreement requires Teleservices International Inc. to pay $5,000 in customerrestitution and $1,000 in investigation costs and to comply with Pennsylvania's TelemarketerAct and Consumer Protection Law.

April 1998:

Pennsylvania Has Last Word With Magazine SellerPennsylvania Attorney General Mike Fisher has obtained an Assurance of VoluntaryCompliance, plus $1,045.50 in investigation costs, from Base & Base, Inc. dba PublishersServices, a magazine subscription seller operating out of Woodinville, Washington. The AVCsettles allegations that Publishers Services failed to comply with Pennsylvania's telemarketinglaw. The agreement requires Publishers Services to register with the Attorney General's Officeand post a $50,000 bond before soliciting magazine purchases over the telephone, send a writtencontract for consumers to sign, and inform consumers orally and in writing of their three-dayright to cancel any magazine subscription contract. "As a state Senator, I authored theTelemarketing Law to protect consumers who make purchases over the telephone," GeneralFisher said. "As Attorney General, I intend to enforce the law. The people ofPennsylvaniashould have, in writing, confirmation of a purchase and be told that phone sales come with aright of cancellation."

Vermont Sends Florida Vacation Company Packing

Vermont Attorney General William H. Sorrell has settled with Florida Travel Network, aFlorida-based vacation package seller. In the suit, General Sorrell alleged that Florida TravelNetwork's telemarketers falsely told consumers that they had won a "free" vacation when, infact, consumers had to pay for the vacations and were required to attend time share presentationswhile on their ''vacations.'' The settlement requires Florida Network Travel to reimburseconsumers who purchased vacations from the company and pay $28,000 in investigation costs tothe State.

June 1998:

Pennsylvania Continues Its No Tolerance Policy Against Non-Registrant Charities

Pennsylvania Attorney General Mike Fisher has reached settlements with twoprofessional fundraisers that violated Pennsylvania's Charities Act and consumer protectionlaws. General Fisher alleged that Young Productions, based in Florida, solicited contributions onbehalf of American Veterans Relief Fund ofDallas, Texas, without ensuring that the charity was

24

properly registered with the Attorney General's office. "Under Pennsylvania Law, thetelemarketer or professional solicitor must make sure a charity is registered for the duration ofthe fund-raising campaign," Fisher said. "In this case, it appears that the charity's registrationexpired before the campaign ended." The settlement requires Young Productions to pay $3,700in restitution, civil penalties, and investigatory costs.

Vermont Refuses to Give Vacation Break a 'Break'

Vermont Attorney General William Sorrell has reached a settlement with VacationBreak, a Florida-based vacation package seller. General Sorrell alleged that Vacation Break liedto consumers by implying that they had won a free vacation when, in fact, they had to pay fortheir vacation. The suit also alleged that Vacation Break failed to tell the consumers that theyhad to attend a time-share presentation while they were on their "vacations." Vacation Breakalso allegedly misrepresented certain charges as "port fees" and failed to infonll consumers oftheir right to cancel overcthe-telephone purchases. The agreement requires Vacation Break toprovide $200,000 in refunds to Vermonters who purchased vacations from the travel seller and$50,000 to the State for investigatory costs.

Pennsylvania Cancels Magazine Subscriptions

Pennsylvania Attorney General Mike Fisher has reached a settlement with Virtual DataCorporation, an Arizona-based magazine subscription seller. General Fisher alleged that thecompany sold magazine subscriptions over the telephone without fIrst registering with his officeand posting a $50,000 bond. General Fisher also alleged that Virtual Data failed to sendpurchase contracts to consumers and did not inform them oftheir right to cancel magazinesubscription purchases. The agreement requires the company to comply with Pennsylvania'sConsumer Protection Law and Telemarketer Registration Act and honor all cancellation requestsfrom consumers who purchased magazines.

October 1998:

Minnesota Gets Restitution for Consumers Who Bought Chances at Florida Lottery

Minnesota Attorney General Hubert Humphrey III reached a settlement with Gold CoastSubscribers, Inc., a Florida-based telemarketing company. Gold Coast allegedly solicited salesfor Florida lottery tickets from Minnesota resideuts, primarily to senior citizens, over the phone.Selling chances at out-of-state lotteries is illegal in Minnesota. Gold Coast has agreed not toengage in telemarketing in Minnesota, and will pay $25,000 in restitution.

Pennsylvania Obtains Compliance Assurance Against Magazine Seller

Pennsylvania Attorney General Mike' Fisher obtained an Assurance ofVoluntaryCompliance from Publishers Renewal Service, Inc., a Kansas-based telemarketer that allegedlyillegally sold magazine subscriptions. The company failed to register with the AttorneyGeneral's office, post a bond, send written contracts to consumers, and inform them oftheir rightto cancel a purchase. "One consumer told my office that after the company received his

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cancellation notice it proceeded to withdraw more than $785 from his bank account," Fisher said.The Commonwealth also alleged that the company misled consumers by claiming to be "atrusted name in quality magazine service for over 30 years," when the business actually openedin 1989. According to the terms of the AVC, the company must register with the Commonwealthas a telemarketer and post a bond. It must also provide consumers with written contracts thatinclude a signature confirmation of a magazine subscription, honor cancellation requests, provide,refunds to consumers who purchased magazines after February 3, 1997, and pay $2,050 for thecosts of the investigation.

February 1999:

Pennsylvania Reaches Settlement with Florida-Based Fundraiser

Pennsylvania Attorney General Mike Fisher reached a settlement with Allan C. HillProductions, Inc. [ACHJ, a Florida-based fundraiser, resolving claims that the company violatedthe Pennsylvania Charities Act and Consumer Protection Law. According to the suit, ACH washired by the Bucks County Handicapped Council to solicit donations for area organizations thatprovide services to physically handicapped individuals. The suit alleged that ACH falsely toldpotential donors that the Easter Seal Society endorsed the campaign and would directly benefitfrom the proceeds. It was further alleged that ACH failed to deposit each contribution into abank account controlled by the charity as required by law. Under the terms of the settlement,ACH will: 1) deposit all contributions in a charity-controlled bank account; 2) train itstelemarketers and employees to ensure compliance with the Pennsylvania Charities Act andConsumer Protection Law; 3) turn over copies of all fundraising contracts, scripts and writtenmaterials to the Attorney General; and 4) pay $8,500 in restitution, a $100 civil penalty, and$1,400 for investigatory costs.

Minnesota Announces Settlement with Vacation Marketer

Minnesota Attorney General Mike Hatch reached a settlement with CommonwealthMarketing Group [CMG], a Pennsylvania-based vacation package seller, resolving claims thatCMG misled consumers into believing they won a free vacation when, in fact, the vacations werenot free. CMG set up booths at numerous events and locations throughout Minnesota with signsproclaiming "Dream Come True Vacation," "Vacation Entry Register Now," and "FloridaBahama Cruise Vacation." Consumers who completed the forms received calls fromtelemarketers who echoed the free vacation claims. Consumers later discovered that the "free"vacations cost $498 to $598 per couple. According to Attorney General Hatch, "The slickmarketing techniques used by CMG made these warm weather vacation packages sound like agreat deal, but consumers were not getting the bargain they were led to believe." Under theterms of the settlement, CMG must provide full refunds to consumers who purchased vacationsfrom CMG and have not traveled on them. In addition, CMG will alter the way it solicits andsells vacation packages as well as disclose all costs and fees prior to a consumer purchasing avacation package. Lastly, CMG will pay $25,000 in penalties and costs.

June 1999:

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Alabama Sues Texas Compauies

Alabama Attorney General Bill Pryor filed suit against Tom Gildenblatt and hiscompanies MultiMarketing Corp; Custom Sports Publications, Inc.; Gildenblatt Enterprises,Inc.; D&L Map Service; Texas H.S. Publications; Weekend Fishenuan; Historical Map Society;and National High School Sports Promotion. In the lawsuit, Attorney General Pryor alleges thatthe defendants sold advertisement space on calendars, sports schedules, and local historical mapsthat they produced, falsely telling businesses that a portion of the advertising fee would godirectly to support local school or atWetic programs. The defendants also allegedlymisrepresented that law enforcement agencies supported the program. Neither the schools norany law enforcement agency sanctioned or were aware of the defendants' solicitations. AttorneyGeneral Pryor seeks to enjoin the defendants from further solicitations in Alabama, restitution forvictims who purchased advertisement space from the defendants, a $2,000 penalty for eachviolation of the Deceptive Trade Practices Act, and up to $10,000 for each violation of theAlabama Telemarketing Act.

August 1999:

West Virginia Reaches Settlement With Canadian Telemarketer

West Virginia Attorney General Darrell V McGraw, Jr. has obtained an Assurance ofDiscontinuance from Upland Global Corporation, a Canadian-based telemarketing companyoffering credit card protection plans. Attorney General McGraw had alleged that Upland Globaltelemarketers, while purporting to be representatives from consumers' banks, had misrepresentedto consumers that their banks required them to purchase credit card protection plans, which soldfor $239 to $259. Once consumers purchased Upland Global's services, they were instructed toprovide the company with credit card account numbers, driver's license numbers, passportnumbers, as well as car and life insurance policy numbers. Attorney General McGraw alsoalleged that Upland Global failed to disclose to consumers that under federal law, credit cardholders caunot be liable for more than $50 of unauthorized charges. Upland Global also madeunauthorized charges on consumers' credit card accounts. Under the tenus of the settlement,Upland Global agreed to cease doing business in West Virginia, provide the names and addressesof every West Virginian who purchased Upland Global's services, and provide refunds toconsumers who request one.

October 1999:

Vermont Sues Septic Product Company

Vermont Attorney General William Sorrell has filed a lawsuit against Septic Care, Inc., aNew Jersey-based company that telemarkets a household septic product called "Pro-ActivatorPlus." Attorney General Sorrell alleges that the defendants falsely told consumers that Pro­Activator Plus saved time and money by eliminating the need to pump septic tanks periodicallyand that Pro-Activator Plus converted all wastes into liquid. Telemarketers also claimed that Pro­Activator Plus was the "most powerful, most effective septic maintenance product" and that Pro-

27

Activator Plus was USDA-approved. Septic Care did not possess test results showing that theproduct provides a benefit to household septic tanks. Furthenuore, the product was not USDA­approved. The lawsuit seeks to prohibit the defendants from violating the law, refunds forconsumers who purchased Pro-Activator Plus, and civil penalties of up to $10,000 per violation.

December 1999:

Pennsylvania Reaches Agreement With New York-Based Fundraiser

Pennsylvania Attorney General Mike Fisher has reached a settlement with Good CauseMarketing, resolving claims that the professional fundraiser falsely told donors that theirdonations would benefit organizations that promote child safety and help locate missing children.According to Attorney General Fisher, potential donors were falsely told that the money raisedwould assist the Missing Children Help Center, the National Child Safety Council, and theUnited Way. None of these charities benefited from the donations. Under the tenus of thesettlement, Good Cause Marketing will pay $20,000 in restitution, plus $5,000 in civil penaltiesand investigatory costs. In addition, Good Cause will make the proper oral and writtendisclosures regarding its status as a solicitor.

October 2000:

New York Reaches Settlement With MemberWorks

New York Attorney General Eliot Spitzer has reached a settlement with MemberWorks,Inc., resolving allegations that the Connecticut-based company charged consumers' credit cardswithout their knowledge or authorization. According to Attorney General Spitzer,MemberWorks entered into agreements with Citibank and other major financial institutions andobtained customer names and account infonuation. MemberWorks used the infonuation intelemarketing campaigns to lure consumers with a "free 30-day trial membership" in one of itsmany clubs. At the end of the trial period, MemberWorks charged consumers annual fees. Manyconsumers who accepted the offer did not understand that MemberWorks had access to theircredit card numbers and would charge them if they failed to cancel during the trial period. Underthe tenus of the settlement, MemberWorks agreed to clearly disclose the negative option methodup front and again before renewal. In addition, MemberWorks must tape every consumer'sconsent to ensure it is knowingly given, provide accurate and non-misleading infonuation aboutthe value of themembership, clearly disclose that it is not their financial institution offering theproduct or service, and disclose that the company already has the customer's credit card numberfor automatic billing.

Idaho Reaches Settlement With Civic Development Group

Idaho Attorney General Al Lance has reached a settlement with Civic DevelopmentGroup d/ba Residential Appeal, LLC., resolving allegations that the New Jersey-basedcorporation made false and deceptive statements when soliciting donations. According toAttorney General Lance, CDG solicitors misled donors into believing that their donations wouldbenefit law enforcement efforts in Idaho and that their scripts were approved by the Attorney

28

General's office. Under the terms ofthe settlement, CDG agreed to stop making false andmisleading statements in telephone solicitations and to register as telemarketers. Lastly, thecompany must pay $10,000 in civil penalties and investigatory costs.

April 2001:

New York Files Suit Against Credit Card Offet:0rs

New York Attorney General Eliot Spitzer filed suits against three Montreal-basedcompanies for engaging in deceptive, fraudulent, and illegal business practices. Named in thelawsuits are: Alini International Marketing, Inc. and its officers Nicole Bertrand and NeilHaboush; Telehublink Corporation d/b/a Triple Gold Benefits and its general manager JacquesDion; and 3557561 Canada Inc. and its president Shawn Jacobs d/b/a Platinum 2000, ContinentalBenefits Group, and the Alliance for Family Security. Attorney General Spitzer alleges thatAlini International and Telehublink deceived consumers into paying a $200 advance fee for anall-purpose credit card, such as Visa or Mastercard. Instead, consumers received a card thatallowed purchases only from a catalog. Attorney General Spitzer alleges that 3557561 Canadafalsely promised consumers credit cards for a fee of $150-$200. Consumers received "free"airline tickets with the purchase of a vacation package, a list of creditors to which consumerscould apply for credit card, credit card applications, and a credit repair manual. The lawsuitsseek to enjoin the defendants' deceptive practices, as well as restitution, penalties, and costs.

RhodeIsland Halts R&R Consultants

Rhode Island Attorney General Sheldon Whitehouse reached an agreement with R&RConsultants, Inc., resolving claims that the Quebec-based telemarketing company, whilemarketing their credit card protection service, falsely told consumers that their credit cardnumbers were available on the Internet. To obtain the service, consumers provided their creditcard numbers and paid $385. The agreement prohibits R&R Consultants from soliciting inRhode Island.

West Virginia Obtains Judgment Against United Publishers' Service

West Virginia Attorney GeneralDarrell McGraw, Jr. obtained a judgment against UnitedPublishers' Service. Attorney General McGraw alleged that the Pennsylvania-based companysold multiple magazine subscriptions to consumers and refused to honor consumers'cancellations of their subscriptions. The judgment requires United Publishers' to pay restitutionand civil penalties. The judgment also enjoins the company from its deceptive practices.

August 2001:

Pennsylvania Settles With Florida Vacation Business

Pennsylvania Attorney General Mike Fisher reached a settlement with Discovery Rental,Inc., resolving claims that the Floridacbased vacation seller made false and deceptive statementsin the sale oftimeshares. Attorney General Fisher alleged that the company offered consumers a

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$299 cruise package and free round-trip airline tickets, without disclosing that travelers wererequired to pay for expensive acconunodations, hidden charges, taxes, and fees, plus attend amandatory time- share presentation. The defendant also failed to inform consumers of theirright to cancel within three business days and failed to register as a telemarketer and post therequired bond. The settlement enjoins Discovery Rental and its officers from all marketingactivities in violation of the Consumer Protection law and Telemarketing Registration Act. Inaddition, the settlement requires Discovery Rental to: 1) honor all cancellation requests and issuerefunds; 2) pay $10,000 in civil penalties; and 3) pay $3,000 for investigatory costs.

West Virginia Settles With Magazine Seller

West Virginia Attorney General Darrell McGraw reached a settlement with InternationalReaders' League of Atlanta, resolving claims that the magazine seller misled consumers about

.their rights to cancel multiple magazine subscriptions. Attorney General McGraw further allegedthat the company misled consumers into believing their memberships to the ''buyers' clubs" werefree with their magazine purchases. The settlement requires International Readers to provide fullrefunds to consumers who were misled into purchasing buyers club memberships. Additionally,the settlement requires the company to notify consumers that they can cancel their magazinesubscriptions at any time.

October 2001:

Missouri Halts Canadian Marketer of International "No-Call" List

Missouri Attorney General Jay Nixon obtained an order against R&R Consultants, ofMontreal, and its owner, Reuben Ross. Attorney General Nixon alleged the defendants marketeda phony International "no-call" list. According to Attorney General Nixon, the defendantsfalsely told consumers that, for a $289 fee, their names would be removed from an internationaltelephone and mail solicitation database. In addition, the defendants falsely told consumers theywould be protected from fraudulent credit card charges. The order permanently bars thedefendants from making misrepresentations and ;requires the payment of $7,440 in investigatorycosts and $7,060 in restitution.

December 2001:

Vermont Settles With Three Fundraisers

Vermont Attorney General William H. Sorrell announced separate settlements with threetelefunders who conducted fundraising campaigns in Vermont. The compauies are All-ProProductions, Inc., of Waltham, Massachusetts; Lester Telemarketing, Inc., of Branford,Connecticut; and MSGI Direct, Inc., of Venice, California. According to Attorney GeneralSorrell, the defendants failed to disclose the percentage of actual donations that would be paid tothe charity. The settlement requires All-Pro Productions to pay $15,000; Lester Telemarketingto pay $5,000; and MSGI Direct to pay $15,000.

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April 2002:

Vermont Settles Consumer Fraud Claims Against Canadian Telemarketers

Vermont Attorney General William H Sorrell has reached a settlement with twoMontreal-based telemarketers, World Wide Source Publishing, Inc. and Ameri-SourcePublic<jtions, Inc., resolving claims that WWS and five of its officers systematically violated theVermont Consumer Fraud Act in the course of selling listings in a directory called the

'''American Business Index." Ameri-Source Publications, Inc., a company that shares commonmanagement and ownership with WWS and uses a return address in New York, also telemarketslistings in a business-to-business directory.

Attorney General Sorrell alleged that WWS used a Vermont return address and solicitedorders for two-year listings in their directories for $399.95. Attorney General Sorrell furtheralleged the defendants violated the Consumer Fraud Act by:

misrepresenting that they offered renewals of listings in the local Yellow Pageswhen, in fact, they offered primarily new listings in a non-local directory oflimited circulation;overstating the circulation of their directories as 1 million when, in fact, it wascloser to 35,000;billing many customers without their authorization;failing to provide customers with their three-day right to cancel; andovercharging customers for a directory that was of limited value to mostbusinesses.

The settlement requires WWS to pay $79,000. ($59,000 in penalties and $20,000 in feesand costs) and Ameri-Source to pay $46,000 ($36,000 in penalties and $10,000 in fees andcosts), for a total of $125,000. The defendants must also provide refunds to their Vermontcustomers. The settlement also bars the defendants from doing business in or into Vermont, orusing a business address or facilities in the state,

June 2002:

Missouri Obtains TRO Against MedPlan

Missouri Attorney General Jay Nixon obtained a temporary restraining order againstMedPlan, Inc., claiming the Canadian-based business charged Missouri seniors $349 for a "free"30-day trial membership to receive medical and health-related discounts. Attorney GeneralNixon alleged that MedPlan called Missouri consumers to offer membership in the "MedPlanPlan," in which consumers would receive discounts and savings on chiropractic, hearing, vision,and dental services and products, pharmaceutical products, and other medical and health-rdated .services. Attorney General Nixon also alleged that MedPlan offered to send a packet ofmembership materials as part of the 30-day, no-cost trial period and told consumers if theydeclined the membership, they would receive a full refund. Attorney General Nixon furtheralleged that MedPlan asked consumers to provide bank account information for verification

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purposes, but made uuauthorized withdrawals from the accounts immediately, and then refusedto provide dissatisfied consumers with refunds.

The order prohibits MedPlan and its employees from obtaining Missourians' bankaccount numbers through telemarketing calls or from making uuauthorized withdrawals fromconsumers' accouuts. The lawsuit seeks a permanent injuuction, restitution, and civil penalties.

Pennsylvania Settles With Front Row Tickets

Pennsylvania Attorney General Mike Fisher reached a settlement with Front RowTickets, Inc., of Steubenville, Ohio, and its president, James Edmiston, resolving allegations thedefendants violated Pennsylvania's Consumer Protection Law, the Telemarketing RegistrationAct, and the Resale of Tickets Law. Attorney General Fisher alleged the defendants resoldentertainment or sporting event tickets to consumers at rates beyond allowable rates. AttorneyGeneral Fisher further alleged the defendants paid others to purchase volumes of tickets forevents and then re-sold them.· The defendants also sold tickets without proper licensing andtelemarketed without registering with the state.

The settlement prohibits the defendants from advertising, soliciting, and/or selling ticketsin Pennsylvania. In addition, the settlement requires the defendants to reimburse consumers forthe amouut of money illegally charged for event tickets. Lastly, the settlement requires thepayment of$5,000 in civil penalties and $10,000 in investigatory costs.

Vermont Settles With East Coast Marketing Group, Inc.

Vermont Attorney General William H Sorrell reached a settlement with East CoastMarketing Group, Inc., of Portland, Maine, and principals, Gaylon Boshears, of Weston,Vermont, and Angela Anastopoulos, of North Waterboro, Maine, resolving allegations thedefendants violated Vermont's Charitable Solicitations Law. Attorney General Sorrell allegedthat in more than 30 fundraising campaigns conducted in 1997-2001 for Vermont public safetyorganizations, ECMG:

failed to comply with filing, financial reporting, and record-keeping requirements;failed to provide appropriate contract disclosures and written. copies of telemarketingscripts to the organizations on whose behalf they raised funds, and to obtain writtenapproval of the scripts;failed to provide to prospective donors important disclosures - namely, that ECMG wasbeing paid, and donors could find out from the state how much of their contributionwould go to the charity; andused language on the telephone which, combined with the absence of the two requireddisclosures, created the impression that ECMG's telemarketers were themselves publicsafety officers.

The settlement requires ECMG to comply with the state's Charitable Solicitations Lawand to avoid misrepresenting their identity or affiliation with any charitable organization. Thesettlement

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further requires ECMG to pay $100,000, of which $86,000 - representing the total commissionsthey received - will go to the Vermont Community Foundation. ECMG must pay theremaining $14,000 in fees and investigatory costs.

August 2002:

West Virginia Settles With Kinetico

West Virginia Attorney General Darrell V. McGraw, Jr. reached an agreement withKinetico Inc., an Ohio-based manufacturer of water treatment systems, resolving allegations itsdealer, Crystal Clear Water, made numerous misrepresentations during the sale of watertreatment systems. The telemarketers for Kinetico were employed by Robert Edward andKimberly F. Wise ofFairmont, West Virginia d/b/a Crystal Clear Water.

According to Attorney General McGraw, Crystal Clear misrepresented that it was an"independent water testing company" offering free in-home water quality tests. Crystal Clearimplied that the tests were being conducted for government or public purposes and refused todisclose that it sold water treatment systems, even when asked directly by consumers. AttorneyGeneral McGraw further alleged Crystal Clear did not have a contract license to install thesystems, misinterpreted the results of in-home water tests to mislead consumers about the qualityof their water and their need for a water treatment system, and made false claims about theefficiency of its water treatment systems. In addition, Attorney General McGraw alleges CrystalClear misled consumers about the terms and conditions of financing and induced consumers topurchase water systems by falsely promising to deliver $2,600 worth of soap products. Lastly,Attorney General McGraw alleged that Crystal Clear Water financed the water treatment systemsby placing them on credit card accounts through Conseco Finance Corporation, in violation offederal law prohibiting "open-end" financing.

The agreement requires Kinetico, which was held responsible for Crystal Clear Water, toprovide refunds and cancel loan obligations of approximately 80 West Virginia consumers whopurchased the water treatment systems. In addition, Kinetico must provide free inspections,repairs and service, and give an extended factory warranty to consumers who wish to keep theirKinetico systems. Lastly, Kinetico is prohibited from credit card financing and must pay $5,000to West Virginia's Consumer Protection Fund.

October 2002:

Missonri Takes Action Against Canadian Companies

Missouri Attorney General Jay Nixon filed suit against Montreal-based AXS Marketingd/b/a Telguard and owner and president, Oren Pinto, alleging the defendants obtainedconsumers' sensitive information by falsely telling them they had unauthorized charges on theiraccounts and that AXS could remove the charges. Attorney General Nixon also alleges thedefendants falsely told consumers that, 'for a fee, they would protect them from unauthorizedcharges and prevent telemarketers and direct mail businesses from contacting or soliciting them.

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Lastly, Attorney General Nixon alleges that the defendants misrepresented that they worked withhis office on anti-fraud efforts. The suit seeks restitution, penalties, and investigatory costs.

In a separate action, Attorney General Nixon obtained an order against R&R Consulting,of Quebec, resolving allegations the defendant called Missourians to sell placement on a phony"international" no-call list. R&R Consulting must pay $14,500 in restitution.

New York Sues All-Pro Telemarketing Associates Corporation

New York Attorney General Eliot Spitzer filed suit against New Jersey-based All-ProTelemarketing Associates Corporation, and its shareholder, officer, and director, Mark Gelvan,alleging they engaged in deceptive solicitation practices on behalf of the Fraternal Order ofNewYork State Troopers. Attorney General Spitzer alleges that All-Pro's solicitors pretended to beNew York State Troopers and failed to identify themselves as paid solicitors. Attorney GeneralSpitzer also alleges that the defendants told consumers their contributions would be used for anti­drug and alcohol presentations in elementary schools throughout the state, and for an emergencyfund to benefit charitable organizations, as well as widows and orphans of the Order's membersand State Troopers. All-Pro retained 85 % of all donations raised and staged only 30 educationalanti-drug programs in nine ofNew York's 62 counties.

Attorney General Spitzer reached a settlement with All-Pro and the Order in 1996,requiring the companies to pay $30,000 in penalties anduse a pre-approved script for telephonesolicitations. The defendants violated that agreement. The suit seeks to permanently bar thedefendants from soliciting charitable funds, as well as restitution.

Pennsylvania Announced Agreement with Xeutel

Pennsylvania Attorney General Mike Fisher entered an Assurance of VoluntaryCompliance with Xentel, Inc., of Alberta, Canada, resolving allegations the company used falseand misleading fundraising tactics purportedly to obtain donations for Pennsylvania'sProfessional Fire Fighters Association. Attorney General Fisher alleged the company falselytold consumers that they were actual firefighters from their local community, who needed help tomaintain and update fire safety programs. It also was alleged that the company falsely toldconsumers that portions of the money raised would assist the Children's Bum Camp andfirefighters throughout Pennsylvania.

Under the agreement, Xentel must pay $14,000 in restitution, $3,000 in civil penalties,and $3,000 for the Commonwealth's investigatory costs. In addition, the agreement requires thecompany to: 1) permanently cease operating in violation of Pennsylvania's Charitable PurposesAct and the Unfair Trade Practices and Consumer Protection Law; 2) issue refunds to consumerswho were victimized and delete their names from the company's call list; 3) provide theCommonwealth with records or documents regarding future consumer complaints; and 4) furnishtaped copies of solicitations during phone room inspections by the Attorney General's Office.

February 2003:

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Illinois Files Suit Against World Voice Link

Illinois Attorney General Lisa Madigan has filed suit against World Voice Link, ofBedford, Texas, and president James Tressler, alleging they falsely told consumers that theywere chosen to receive a "free" pager and paging service if they tried the defendants' call­messaging service, and charged consumers for services they did not authorize. The suit seeks apermanent injunction, restitution, civil penalties ofup to $50,000 per violation, and court costs.

Illinois Files Suit Against Canadian Fundraiser

Illinois Attorney General Lisa Madigan filed suit against David P. Suggitt d/b/a HealingHands Busy Book and D.P.S. Activity Publishing, ofAlberta, Canada, alleging the defendantsfalsely told consumers their donations would be used to purchase "Healing Hands Busy Books"for children staying at local hospitals. Attorney General Madigan alleges the defendants keptdonations and never donated books to hospitals. Attorney General Madigan further alleges thedefendants failed to register as a charitable organization and a professional fundraiser. Inaddition, the defendants allegedly failed to obtain permission from local hospitals to use theirnames as part of their solicitation campaigns. Attorney General Madigan obtained a temporaryrestraining order and seeks a full accounting of the defendants' charitable assets. The suit alsoseeks a permanent injunction, forfeiture of all monies collected, and a fine of at least $100,000.

Missouri Halts Internet-Related Service Companies

Missouri Attorney General Jay Nixon obtained a preliminary injunction against NationalOnline Services, Liberty Online Services, and Epixtar Corporation, enjoining the group ofMiami, Florida-based telemarketers from placing charges on consumers' phone bills withouttheir express verifiable authorization and from misrepresenting facts to consumers. According toAttorney General Nixon, the company telemarketed consumers to sell Internet-related servicesand placed unauthorized charges of $30.85 on consumers' telephone bills. Attorney GeneralNixon further alleged that some charges appeared, even without a telemarketing call. Lastly,consumers who tried to contact National were either unsuccessful or had additionalmisrepresentations made to them, including promises of credits that were never issued on theconsumers' telephone bills. Attorney General Nixon seeks a permanent injunction, as well asrestitution for Missouri consumers.

April 2003:

Missouri Reaches Agreement with Timeshare Marketer

Missouri Attorney General Jay Nixon has reached an agreement with Arkansas-basedResort Mart, which also did business as Century 21 Resort Mart, and owner John Dunn,resolving allegations that Resort Mart misled consumers into purchasing its timeshare resaleservices. Attorney General Nixon alleged that Resort Mart offered a resale service for consumersseeking buyers for their timeshare properties in Branson, Missouri and other vacation spots. Inexchange for an up-front fee and a listing agreement, Resort Mart promised to advertiseconsumers= properties and find buyers for those properties. Consumers complained that Resort

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Mart teleIIlarketers falsely told them that the company would find buyers for their propertiesquickly and that Resort Mart did not make an effort to find buyers for their timeshares.

The agreement requires the defendants to pay $25,000 in restitution; to accurately disclose theservices it will provide in exchange for payment of the up-front fee and that a refund may beobtained within five days ofreceiving written notification of the terms of the agreement; and tonot misrepresent the likelihood that a timeshare will be sold as a result ofpurchasing anagreement.

Vermont Settles With Time-share Promoter

Vermont Attorney General William Sorrell reached a settlement with Florida-based CapeCanaveral Tour & Travel, Inc. and principals Lory Walker and Michael Dwyer, resolvingallegations they misrepresented the purpose of their telemarketing calls, misrepresented vacationpackage offers as special offers, failed to disclose that consuiners were required to take atimeshare tour in order to take advantage of the vacation package offer, and failed to notifyconsumers of their three-day right to canceL The settlement requires the defendants to complywith the Consumer Fraud Act, provide refunds, and pay $80,000 to the state.June 2003:

Missouri Bars Canadian Telemarketer

Missouri Attorney Jay Nixon reached a settlement with Morton Garellek, of Westmount,Quebec, d/b/a Morton Garellek and Associates, 2880474 Canada Inc., Guardian InformationSystems, Guardian InfoServices, Guardian Protection Services, Guardian Security Services,Guardian Emergency, Guardian Medical Information, Emergency Medical System, EMID, andBlack Blazer Investments Inc., resolving allegations that he acted through telemarketers whomisrepresented that they were calling from government agencies or consumers' credit cardservice centers. These telemarketers attempted to obtain consumers' personal and bank accountinformation by offering a variety of services, such as inclusion on a phony no-call list. Thetelemarketers used the financial information they obtained to debit consumers' bank accounts.The settlement bars Garellek from doing business in Missouri and requires him to pay $10,000 inrestitution and $25,000 to the state.

August 2003:

Florida Settles W!t1t Members Platinum

Flr)1'l~tl Atto11le;tGeneral Charlie Crist ceacltedasdtlementwitltNevada.basedMembersPlatinlll11~:me" res.ol"l'ing claims its telemarketers~eptively marktted 8 creditenhlmcementprogram toco~. Consumers were misled into believingMembers Platinum could improvet¥ircredit standing andhelp~obtain amajor credit card for $199.95. ConsuIll«l!re<:eived aninformationPlIPket contaillil,lg Wl'itlen materialS about lIJlplying for acredit card and received aMembers ·credit"card thatcouldbeusedto pUl'chase items only from a catalog. MembersPlatinumagreed to pay $53,000 in tistitutiQU and penalties and ceased its business operanoIlS.

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October 2003:

Illinois and Minnesota File Suits Against Collect Call Telemarketers

Illinois Attorney General Lisa Madigan and Minnesota Attorney General Mike Hatchfiled separate suits against New Mexico- and Nevada-based American Directory Services, Inc.and Talk Too Me, LLC d/b/a 00 Operator Services, and American Directory Services, ofSarasota, Florida, alleging they defrauded small businesses by placing collect calls to thebusinesses and demanding payment for those calls. American Directory Services placed the calls,while Talk Too Me provided collect call services. The defendants sent consumers "Final Notice"billing statements for $28.84 on which Talk Too Me identified itself as the "00 Operator" andAmerican Directory Services was identified as the initiator ofthe call. Most complainingbusinesses denied receiving or accepting a collect call or stated they accepted them only aftertelemarketers actively misled them into accepting the call. Businesses who attempted to contactTalk Too Me found that the line was busy or the call would not go through. Businesses that triedto contact American Directory Services found its number was disconnected.

Missouri Files Suit Against "Nonprofit" AmeriDebt

Missouri Attorney General Jay Nixon filed suit against Maryland-based AmeriDebt a/k/aDebticated, Inc., Debtworks Inc., Ballenger Group Inc., Ballenger Group Holding Inc., InfinityResources (later renamed F&M Mortgage, Inc. and Fidelity and Trust Mortgage, Inc.), andowners Audris and Eriks Pukke. Attorney General Nixon alleges that, while AmeriDebt tellsconsumers it is a "nonprofit" that operates at cost and does not make money, the companyfunctions like a profit-driven enterprise. Employees referred to as "credit counselors" or "debtprofessionals" are actually salespeople selling fee-based debt management plans that provide nosignificant help with budgeting.

Attorney General Nixon alleges AmeriDebt aggressively advertises that it charges no up­front fee to consumers, but downplays or hides that the payments it charges do not go to thecreditors, but are retained by the company. Attorney General Nixon alleges that these fees addbetween $1,000 and $2,000 to the amount consumers must pay to satisfy their debts.

The suit seeks an order voiding any contract made between Missouri consumers andAmeriDebt, restitution of money not forwarded to creditors, civil penalties of up to $1,000 perviolation, costs, and attorneys' fees.

Vermont Settles With Paid Fundraiser

Vermont Attorney General William Sorrell reached a settlement with New Jersey-basedCivic Development Group [CDG], alleging it misrepresented that all donations it solicited wouldbenefit Memorial, a charitable organization constructing and maintaining a memorial tofirefighters and police officers. According to Attorney General Sorrell, CDG gave only 15% ofthe total proceeds to Memorial. Attorney General Sorrell also alleged CDG did not provide itstelephone number to prospective donors when requested. The settlement requires CDG tocomply with Vermont's charities laws and ensure that all disclosures it makes to prospective

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donors are clear and conspicuous. CDG must pay $10,000 to the Memorial and $5,000 ininvestigatory costs.

December 2003:

MIssouri Orders Coadlan tollery to Cease and Desist

MissIJW'i4ttorney GeneralJayNixonissuedaceaseanddesist orderagainstMontreal41asedfntemationalProteclionC~ter,pt"Q!nl>itinglPCfrllmCllllinginiuMilloouri. IPC's lelemarkelersoontactedcOIlSUIllerBillldmstrucledthemtopaydeeofupto$700toclaimail millionjackpot rrIPe violatesAtt0meyG¥neralNixon'sorder,itcouldfilcefelonycbargesofunlawfulmarketing, amaximumpenaltyoffour years imprisonment and a$S,OOOfine.

April 2004:

Illinois Files Snit Against Fnndraisers

Illinois Attorney General Lisa Madigan filed suit against Texas-based Veteran PoliceAssociation (VPA), Vet-Pol Advertising, Inc. d/b/a V.P.O., Inc. and VPA President PeterRuderschmidt. The suit alleges that Vet-Pol solicited donations to VPA, falsely claiming thatdonations would support the needy, a Junior Police Academy, and elder-awareness campaign,death benefits for officers' families, and crime prevention projects. The suit further alleges thatneither VPA nor Vet-Pol registered to solicit in Illinois, that Vet-Pol solicitors falsely claimed tobe police veterans, and that Vet-Pol solicitors failed to disclose to donors that they wereprofessional fundraisers.

Pennsylvania Settles With Florida Telemarketers

Pennsylvania Attorney General Jerry Pappert reached a settlement with Talk Too Me,LLC d/b/a 00 Operator Services and American Directory Services, resolving claims itstelemarketers misled consumers into believing they were receiving collect calls from friends andrelatives. When consumers realized the defendant was selling Internet directory services, theyhung up, but were charged $28.84 for staying on the line. The settlement requires Talk Too Meto provide full refunds to consumers, to permanently cease providing or assisting in placingcollect telephone solicitation calls, and to pay $2,500 in civil penalties and investigatory costs.In additions, the settlement prohibits Talk Too Me from pursuing collection of any chargesrelated to collect-call solicitations and from engaging in unfavorable credit reporting regardingunpaid bills.

Pennsylvania Settles With Membership Program Offeror

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Pennsylvania Attorney General Jerry Pappert reached a settlement with Connectlcut­based MemberWorks Inc., resolving allegations its telemarketers failed to adequately disclosethe terms of"free" trial offers and renewal processes for membership programs. According toAttorney General Pappert, MemberWorks offered no-cost trial of membership programs, butfailed to disclose that consumers were required to act on their own to cancel memberships ortheir credit cards would be charged. The settlement requires MemberWoks to credit or refunddisputedcharges brought by consumers; clearly and conspicuously disclose the fees, terms andconditions associated with trial offers; and clearly and conspicuously disclose the name of eachseller offering the membership program. MemberWorks also must truthfully disclose the exactbenefits, discounts, rebates, or other free offers associated with the programs and obtain theexpress written or taped verifiable consent of consumers prior to billing their account formembership fees. Lastly, MemberWorks must cease using the term "free" to describe incentiveoffers and pay $40,000 in investigatory costs.

Vermont Settles With Debt Management Telemarketer

Vermont Attorney General Bill Sorrell settled with Florida-based Integrated CreditSolutions (ICS), a company that telemarketed on behalfof a debt management company.According to Attorney General Sorrell, the defendant left pre-recorded messages and/ortelemarketed consumers to enroll in a debt management program operated by Lighthouse CreditFoundation. Attorney General Sorrell alleged ICS misrepresented that consumers had been "pre­approved" for Lighthouse's services and that enrolhnent in the debt management program wasfree. ICS also allegedly failed to give consumers a three-day right to cancel and failed to registerwith the State as a paid fundraiser. The settlement requires ICS to comply with Vermont andfederal aw and refund all enrollment fees collected from Vermonters. ICS also must pay$30,000 in attorneys' fees and investigatory costs.October 2004:

Vermont Annonnces Settlement With North American Telephone Network

Vermont Attorney General William Sorrell announced that Atlanta-based NorthAmerican Telephone Network, L.L.C. has paid $25,000 to the State of Vermont to settle claimsthat it violated Vermont's Consumer Fraud Act in the course of telemarketing long-distancephone plans. According to an Assurance of Discontinuance, North American TelephoneNetwork offered long-distance telephone service plans, such as an initial 1,000 "free" minutes,for which consumers had to pay a fee in order to access.

May 2005:

Missouri Sues Investment Offerors

Missouri Attorney General Jay Nixon filed suit against Las Vegas-based AskGT.com;Oregon-based Rose Laboratories; and De Elroy Beeler a.k.a. John Montgomery, an agent forboth companies, from Tujunga, CA. Also named is Wester S. Cooley ofDelray Beach, FL., whois president of AskGT.com and affiliated with Rose Laboratories. According to Attorney GeneralNixon, the defendants phoned consumers and made misrepresentations while attempting to sell

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shares of stock in AskGT.com. Several individuals wired their money to Beeler, and eitherreceived nothing in return or stock certificates that did not contain a seal. The securities were notregistered by the Missouri Secretary of State, and Beeler was not licensed to sell securities inMissouri.

June 2005:

New York Halts Fundraisers

New York Attorney General Eliot Spitzer obtained an order banning Liberty Productions,ofNorth Providence, Rhode Island, and owners Thomas J. Gity and his son, Thomas J. Gity, Jr.,from conducting professional fundraising in New York. The lawsuit alleged that LibertyProductions conducted fraudulent telephone solicitations on behalfof 16 police and firefighterorganizations. Liberty's solicitors failed to identify themselves as professional fundraisers andfalsely told potential donors that they were retired police officers, police officers-in-training, orvolunteers.

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